Bryant Park Hotel debt purchased at substantial discount

Kansas City-based Mission Peak Capital has acquired the $85 million loan on the landmark Bryant Park Hotel for just $65 million.

Using the so-called “fair value purchase option,” Mission paid well below the property’s last value assessment of $71 million, which was published in February.

The firm was able to use its right as the controlling class investor to buy the defaulted loan — which was taken out in 2007 ahead of other stake holders. Such arrangements were scrapped during the financial crisis but remain in force in many older CMBS deals, according to Reuters.

The deal has angered some investors who believe that the special servicer Key Bank should have demanded more.

“New York hotels are in great demand,” one lender familiar with the deal told Reuters. “Why did this happen?”

The luxury hotel is located at 40 West 40th Street, near Sixth Avenue.